Here again, its initial rally attempt has been capped by the 50-day moving average, currently 8,022.

The subsequent pullback has been underpinned by the bottom of the August gap (7,836). Monday’s session low (7,834) registered within two points.

Combined, the S&P 500 and Nasdaq Composite have observed well-defined support even amid the volatile backdrop.

Widening the view to six months adds perspective.

On this wider view, the Nasdaq maintained major support (7,670) a level defining the late-2018, mini-crash range top. The August low registered within seven points.

The subsequent rally attempt has filled the August gap, an area also illustrated on the hourly chart.

Tactically, the 50-day moving average, currently 8,022, is followed by the top of the July gap (8,059), a level established to start the third quarter. Both areas have been tested early Tuesday, and a close higher would strengthen the bull case.

Looking elsewhere, the Dow Jones Industrial Average has rallied from the 200-day moving average.

The reversal has thus far been capped by the
50-day
moving average, currently 26,600.

Within the range, the 26,250 area is followed by the post-breakdown peak (26,413). Tuesday’s early session high (26,427) has matched the latter, and the retest remains underway.

Meanwhile, the S&P 500 has also whipsawed from major support.

Recall that the August low (2,822) has registered nominally atop the 2,817 support, a level defining the late-2018, mini-crash range top. (This area corresponds with Nasdaq 7,670.)

The subsequent rally attempt initially registered consecutive closes atop the breakdown point (2,912) — constructive price action — though it was punctuated by Monday’s pullback to the 2,873 support.

The bigger picture

As detailed above, the major U.S. benchmarks continue to whipsaw amid a pronounced August volatility spike.

On a headline basis, the S&P 500 and Nasdaq Composite have spiked from major support — the S&P 2,817 and Nasdaq 7,670 areas — though the subsequent rally attempt gets mixed marks for style. Each benchmark initially filled the August gap, which is bullish, though Monday’s sharp downturn raises a question mark as to the rally attempt’s sustainability.

(Market bulls will contend that the S&P and Nasdaq both maintained well-defined support Monday — at S&P 2,873 and Nasdaq 7,836 — constructive price action.)

Moving to the small-caps, the iShares Russell 2000 ETF has whipsawed around the 200-day moving average, currently 151.10.

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